Berkshire paid $26.5 billion for the 77.5 percent it did not already own of Burlington Northern, selling some stock holdings to fund its largest acquisition ever.

The company sold a net $639 million of equities in the quarter, and revealed that this included part of its stake in Procter & Gamble Co , one of its biggest investments.

Results were in line with the preliminary forecast that Berkshire released on May 1 at its annual shareholder meeting in its Omaha, Nebraska, hometown.

Buffett said he had seen an uptick in activity in Berkshire's manufacturing businesses, such as the conglomerate Marmon Holdings Inc and the toolmaker Iscar Metalworking Cos. Cost-cutting also helped this segment's results.

Buffett also said luxury goods units Borsheim's Fine Jewelry and NetJets were seeing business improve from a very, very low level, while results for housing units such as Acme Brick Co and insulation maker Johns Manville were very poor.

Results included $1.41 billion of gains on investment and derivatives, including long-term contracts tied to four equity indexes, including the Standard & Poor's 500 .SPX>.

Berkshire replaced Burlington Northern in that index after splitting its Class B shares 50-for-1 to allow more investors to swap the railroad company's stock for Berkshire stock.

Berkshire's cash stake fell to $25.67 billion as of March 31 from $30.56 billion at year end.

The quarterly report did not address a Wall Street Journal report on Thursday that the U.S. Securities and Exchange Commission is reviewing whether it disclosed its desire to buy Burlington Northern fast enough.

In Friday trading, Berkshire Class A shares closed down $2,000 at $111,500, and its Class B shares fell 18 cents to $74.41. Berkshire's market value is about $184 billion, based on reported shares outstanding.